Panel session: Performance-based financing: a paradigm shift in the aid sector?

23 Dec

Jacky Mathonnat chaired a panel session on whether PBF represents a paradigm shift in the aid sector. The main objective was to check with aid agencies if the PBF strategy affects or will affect their models and instruments for channeling assistance to recipient countries or organizations. This made for a lively and at times provocative debate. We summarize some of the ideas that were put forward, without specifying which representative made the particular statements.

(Participants of the round table were: Frank Van de Looij (Cordaid), Laurent Musango (WHO/Afro), Agnès Soucat (WB), Bénédicte Brusset (AFD), Ingvar Olsen (NORAD), Pierre Cavert (EC, Burundi) and Yogesh Rajkotia (USAID, Rwanda).)

1. PBF can be found at many levels: it’s not just a national strategy (in the US government for example, PB contracts have been pretty common for a while now) but also globally results based financing is the ‘talk of the town’. There is more and more a focus on results in Global Health Initiatives (like Gavi); increasingly funds are going through these channels. The paradigm shift is thus not only visible at country level, but also globally. Somebody aptly remarked that aid will cease to be relevant if it can’t show results. At least part of the aid architecture is moving in the direction of “SWAP with teeth” (boosted with results). Obama’s Global Health Initiative will most likely share this results based approach. Having said that, it remains to be seen to what extent things in the next decade or so will continue to resemble the “We get it, but we still don’t implement it” comment, made by one participant, referring to his organization. On the other hand, institutions and organizations should also refrain from proceeding too quickly with PBF reform, as a lot of donor fatigue is due to the need for immediate results.

2. Several participants emphasized that it is vital to get the PBF message right. Results based financing is not P4P, as it forces us to examine the whole chain of where the money goes. A broader human resources reform is crucial: just providing bonuses and salary supplements to civil servants is definitely not the way to go. One should thus not interpret RBF in a narrow sense. Design matters. The core is about autonomy and reform for which you need to engage with all (and preferably also high-level) stakeholders. Burundi is a case in point. Success hinges on this discussion with key actors, one should definitely not just push through one’s own agenda. Last but not least, just dealing with MoH does not suffice, as it often lacks political weight. At the very least, MoF should also be involved, as it plays a key role in the new aid architecture (with budget support).

3. PBF is complex and requires resources but the strategy also provides plenty of opportunities. It can treat existing problems, trigger reforms (like the autonomy of health facilities, decentralization ), contribute to a unified health information system, induce a new dialogue with actors that had so far escaped sector dialogue ( some vertical actors for example ), and the health sector can also constitute a PBF pilot sector for other public sectors.

4. In terms of the process, NGOs can play a useful role in starting PBF pilots in countries. When scaling-up, however, other skills become necessary (like advocacy skills, building networks, …) as then leadership of Government becomes much more essential.

5. Another issue raised during the discussion was whether PBF increases the fragmentation risk and can be at odds with the budget reform goal. Fragmentation risk is definitely an issue, some participants noted. By way of example, somebody referred to PBF for HIV service delivery in Ethiopia, happening somewhat outside the public health system (set-up of parallel PBF units).  Another participant stressed that, even if one enthusiastically embraces the Paris declaration goals, still, in practice things can go terribly wrong in some countries.

6. Finally, a participant mentioned that the Ministry of Finance is often, unsurprisingly, reluctant to have big chunks of money going to public-private fund holders (like the provincial fund holders in DRC). One explanation is that the PFM Performance Measurement Framework, which has been developed by donors engaged in budget support under the PEFA (Public Expenditure & Financial Accountability: program, discourages the transfer of public budget resources to mixed entities. Obviously, many actors have still to adapt their instruments to result based financing.

6 Responses to “Panel session: Performance-based financing: a paradigm shift in the aid sector?”

  1. Bauma M. Shebosh Ngoy 03/01/2010 at 10:14 #

    I agree with the idea of government involvement, this is esential to hope a sustainability of the PBF strategy application as donor wont continu to give money to a behavier change which need long time to see clear effect and reducution of perverses effect.

    PBF help stakeholder to undestand the planning and contracting process which is the key factor of all relationship.
    The problem is that it needs more time…it is not emergengy

  2. Julia Ilse 05/01/2010 at 12:12 #

    Why is it so important to stress the difference between P4P and result based financing? What exactly makes the difference?
    It was discussed and stressed by the representative of the World Bank during the panel discussion.

    Thank you for your response


    • Bruno Meessen 06/01/2010 at 16:30 #

      Hi Julia,

      I think that what Agnès meant is that P4P is nearly a trade-mark formula today. To my knowledge, it relates to experiences in USA (mainly) which targets individual physicians and try to get them complying with some quality guidelines. If you say P4P, people think of that.

      Result-based financing intends to be much broader. For instance, P4P has been developed in countries where there is already fee-for-service. In Africa, introducing a fee-for-service system with a third party payer (e.g. for preventive services) in systems where everything is input-based could already be considered as a result-based financing approach.

      Part of the problem is that everyone tries to coin his own term. At the end, it is just on getting incentives right.

  3. Lucet Catherine 04/02/2010 at 14:45 #

    Hi Julia, Hi Bruno,

    As Julia, I was a bit confused by the terms used.

    Agnès Soucat insisted on the difference between P4P and RBF. Up to now, I considered P4P as a one exemple of a RBF method. According to my readings in P4P initiatives, selective indicators are monitored and once the pre-set targets of expected services is reached, the health practitioner (or group of practitionners) is eligible for a financial reward.

    Another speaker of the World bank presented us the “Activity Based Financing” initiatives of the Bank. I was wondering if activity based financing is a synonymous of results based financing or another concept?? More over, is Activity Based Financing different from Fee-for-Service?

    Another question puzzled me. Is the RBF program as presented in Rwanda really based on results or only on activity ? The impressive evaluation presented by Christel Vermeesch provided us among others, figures on vaccination coverages and prenatal consultation coverage. As a health practitionner, for these coverages figures to be considered as results, the aspect of quality of care was missing.
    The vaccination coverage is a result if the vaccines used were effective ( kept in a good cold chain) and administered in the good way (correct site of injection, sterile needles).
    Effective pre-natal consultations need to be condusted according recognised recommandations for administration of vaccines, vitamines etc.
    Should not be RBF programs more interested in the quality of the care delivered ?

    Could I suggest to put the topic of the quality of care on the agenda on the next symposium on RBF?

    Could I alos strongly suggest to the RBF specialists (Academics or World Bank) to provide a glossary with a clear definition of the terms used?


  4. Mwila K 04/03/2012 at 21:38 #

    What is the conceptual framework under which PBF is cornerd and who framed it?
    Also when I read on Zambia RBF with support from Cordaid it shows so many flaws and worse still the government was not fully aware of CHAZ undertaking PBF in Mission hospitals as PBF pilot. And from that country’s perspective, mission hospitals are far much better in starndards than government hospital…so how do you allow such a pilot? As for World Bank, the crriteria is good so far looking at the pre pilot outcomes and the ministry of health is highly steering the processes,but what measures are in place to ensure that these monies are accounted for as expected?

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